Scottish game ‘in good shape’

Date published: Monday 24th August 2015 12:10

Scottish game 'in good shape'

Following Rangers’ administration and subsequent liquidation in the summer of 2012, warnings of a financial collapse were rife in Scotland.
Governing body officials claimed clubs could survive for a ‘short period of time’ but without Rangers, who began again as a newco in the bottom tier of the Scottish League, ‘it would not be sustainable’ and the game could suffer a ‘slow, lingering death’.
However, since then St Johnstone, St Mirren, Aberdeen and Inverness Caledoinian Thistle have tasted glory in national cup competitions after the game regrouped north of the border. 
Now a survey by accountants and business advisers BDO LLP shows all Scottish clubs have their finances in good shape with none intending to sell any future earnings, such as advances on season tickets or media income.
‘Harsh lessons’
The annual survey – entitled Investing for Success: Football Finances and Commercial Growth – showed that these actions are ‘broadly in line with clubs across the UK which have learnt the harsh lessons of selling off future income to fund current liabilities’.
However, it does show that profitability is ‘difficult to attain’ with just one club stating they would make a profit after player trading and depreciation.
Income streams remain subdued with a mixed picture across Scottish Premiership football while the clubs are fairly evenly divided between those who have experienced reduced takings from match tickets, catering, season tickets and sponsorship and those who stated that all of these income streams have improved over the year.
Three quarters of clubs stated that corporate entertaining has gone down over the last year with one of the Scottish Premiership clubs surveyed stating their current owners are ‘considering an exit within the next 12-18 months and that they have been approached by external investors with a view to taking a stake in their club’.
Generally, the survey shows clubs are more optimistic about the forthcoming season with the majority believing revenue will increase in 2015/16 while the biggest concern for the coming season is falling attendances due to the state of the economy and inflexible players’ salaries. 
Charles Barnett, professional sports group partner at BDO, said: “It is clear that the financial lessons of the last decade which saw several Scottish football clubs go into administration have been learnt. 
“There is a much greater understanding and will to ensure financial security in the years to come. Clubs know they cannot borrow now to fund future success and have responded accordingly. They are also much more aware of the need to develop new sources of income where possible.”
‘Summer football’
One potential source of new income derives from Scottish clubs’ desire to play in the summer with the survey finding that all of the clubs who responded said they were in favour of summer football whereas the response in England ranged from 12% in the Sky Bet Championship and 27% in League One.
Barnett added: “The appetite for summer football in Scotland is apparent even accepting the relatively small number of Scottish Premiership clubs who responded to the survey. 
“Not only might the the quality of football improve on better playing conditions but the clubs who generally have to participate in the qualifying rounds for the Europa League and Champions League might also benefit from squads that are better prepared for these earlier rounds.
“In England, the feeling is clear that there is not sufficient financial incentive to justify disrupting the current football schedule.”

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